Quality control refers to the process, most often implemented in manufacturing, of monitoring the quality of finished products through statistical measures and an overall corporate commitment to producing defect-free products. Quality control principles can also be utilized in service industries.
The term "quality control" came into common use in the 1950s thanks to W. Edward Deming, whose "Fourteen Points" have become the bible for quality control proponents. With the post-war world returning to normal manufacturing patterns, Deming preached that inspecting products for quality after they were manufactured was unacceptable. Instead, he proposed a process known as "statistical quality control" that would use closely monitored performance measures to gauge quality as a product was being manufactured. The goal of statistical quality control was to gather data that would allow for the constant improvement of manufacturing processes, which would in turn improve quality control. Introducing such statistical controls could be expensive, but Deming argued that instituting quality measures ultimately saved companies money.
Another important tenet of Deming's beliefs was that upper management was largely to blame for quality failures. He firmly believed that, given the right tools and working environment, workers would strive to create the highest quality products possible. In Deming's own words, "the basic cause of sickness in American industry and resulting unemployment is failure of top management to manage." He believed that strong leadership led to an inspired work force that did not fear management and did not fear taking chances when seeking ways to improve quality.
If strong leadership is the buzzword for managers in a quality environment, then empowerment is the key concept for workers in Deming's system. Improved education and training are the key factors in reaching employees and making them believe that their increased participation in the work process is an essential part of improving quality. Involvement, participation, and teamwork are seen as absolute musts if a quality workplace is to be created.
The Japanese were the first to adopt Deming's Fourteen Points, and with great success. As an example, Deming learned of one Japanese factory that doubled production in just one year and was expecting to gain an additional 25 percent improvement the following year, with no increase in the amount of hours worked. All this occurred as a result of simply improving quality. What is most significant about this achievement is the year it happened—1951. Many American and European companies chose to ignore these dramatic results and nearly perished as a result. Critics contend that by the time American manufacturing plants realized that quality control was a significant issue, it was the late 1970s and Japanese firms such as Honda and Sony were taking over large portions of the American consumer market.
In the 1990s, most American firms have embraced quality control practices. Analysts indicate that when firms first began adopting these principles, many went too far, becoming bogged down in quality control charts and measurements of inconsequential operating factors. In too many cases, American industry went from ignoring statistical quality control to applying it to every single facet of a business, no matter how small. This overemphasis quickly disappeared, however, and has been replaced by a commitment to overall quality control that is unprecedented in the American workplace.
Because they have been practicing quality management since the 1950s, the Japanese are still the leader in producing quality products in a number of industries and are still the role model for U.S. companies to emulate. For example, a study of the air conditioning industry in the early 1990s found that the worst Japanese air conditioning plant had an error rate that was less than one-half that of the best U.S. company.
This drastic difference is largely due to the Japanese adherence to one of Deming's most important ideas—that quality should be "designed in" to a product instead of "inspected out." Japanese firms treat suppliers as equals, sharing information with them as if the supplier was an internal department of the company. This ensures that quality is already a part of the product before it is even manufactured.
Another common practice in Japan that has found its way to the United States are "quality circles." Workers are brought together on a regular basis to brainstorm about quality and manufacturing processes, all with an eye towards improving quality. The circles are a success if management follows through on its end of the deal and incorporates the suggestions made in the quality circles into operations. When workers see their suggestions implemented, it increases their confidence in management and in the company as a whole, which in turn increases their commitment to the company and to producing high quality goods.
A highly trained work force is one of the keys to producing quality goods, and the training programs of many American companies reflect this recognition, for they are allocating more time and money to this area. Still, many U.S. companies lag behind in this respect. Researchers have stated that a higher commitment to training and lifelong learning are needed if the commitment to quality is to continue.
Today, the key components of quality control that were preached by Deming and practiced by the Japanese—including benchmarking, supplier partnering, and continuous improvement—have found their way into American industry. Each of these components demands a closer look.
Benchmarking is a continuing process of measuring products, services, and practices against your strongest competitors. More simply stated, it means using the best companies as the yardstick against which your company measures itself. If your company comes up short, than improvements must be made to ensure that your products are just as high in quality as those of your competitor.
There are two types of benchmarking. The first, competitive benchmarking, entails benchmarking against direct competitors in the marketplace. This can include comparing specific numerical or statistical measurements—return on assets used, market share, etc. The more detailed information that can be obtained about a competitor, the better.
The second method, noncompetitive benchmarking, can take two forms. The first is measuring your company against the best companies in the world, regardless of industry. Companies such as 3M, Coca-Cola, and General Electric are considered to be trendsetters and leaders in quality, so companies from nearly every industry study them and copy their best practices. Business analysts note that noncompetitive benchmarking is a broader—and sometimes more useful—instrument of quality control. By only benchmarking against competitors, a company only ensures it will be as good as that competitor. By benchmarking against the best companies in the world, a company can aspire to be as good as those companies and can surpass the competition in its own industry. Additionally, companies may find it easier to gain access to information about companies they do not compete with because they are not seen as a threat to the well-being of the company.
The second type of noncompetitive benchmarking is internal benchmarking, which involves comparing functions or processes in different departments within the same organization. Internal benchmarking is often seen as a logical starting point for a business that is attempting to use benchmarking for the first time.
To successfully benchmark, a company must first look closely at its own practices and conduct a rigorous self-assessment. Once that self-assessment is completed, the company has a good idea of where it stands on each quality issue and can successfully compare itself to other companies. The self-assessment must be honest and thorough. It should identify weaknesses, but should also highlight strengths. Improving weaknesses that are identified should be tied to stated company strategic aims.
Supplier partnering is an increasingly common practice in the United States. Simply put, it means that manufacturers work directly with their parts and components suppliers to improve quality at the supplier's location. This can involve direct participation in the supplier's operations—that is, staff from the manufacturer might work on-site at the supplier's office or provide technical assistance and equipment—or simply a very close working relationship that more resembles a partnership rather than a simple business transaction between two unrelated companies.
One of the biggest methods of partnering with suppliers involves sharing the use of statistical controls. This is an underdeveloped area in the United States that should grow in the coming years. Most manufacturers have switched to outsourcing as a means of cutting the costs of production. This increased emphasis on outsourcing means that the companies that supply the parts or components must place just as much emphasis on quality as the manufacturer if the finished product is to be high quality.
Among the quality issues that still need to be addressed in the manufacturer-supplier relationship are:
In many industries, especially the auto industry, manufacturers are overcoming these supplier problems by helping the suppliers meet quality standards.
The other facet of supplier partnering means that the manufacturer also actively seeks out feedback from the supplier on how the former's operations can be improved. Suppliers often have a unique perspective on the industry they work in and on the companies they supply and can provide valuable advice on how to make changes for the better. When this happens, it is important that the two companies have a framework in place to manage the partnering system. This can mean that the manufacturer's purchasing department would be deemed as the intermediary between the two companies, passing information from the supplier back to the appropriate internal customers.
Continuous improvement (CI) is a method for improving every facet of a company's operations and increasing competitiveness by developing a company's resources. The improvement can involve many goals—producing products with zero defects or achieving 100 percent customer satisfaction—but CI has the same basic principles no matter what the goal:
Continuous improvement most often involves creating a team that includes representatives from all areas of the company. The team first spends time learning—about the company they work for (looking at it in new ways) and about other companies (benchmarking is common during this phase). The necessary quantitative data is created. The team then proposes solutions to management and begins to implement those solutions. Once that is achieved, follow-up mechanisms must be put in place that seek additional improvements as time goes by. The team might change members with the passage of time, but hopefully it will become an established and accepted part of the company even as its roster changes. If the endeavor works as planned, the team will have improved quality to show as a result of its initial efforts. This can make even skeptical employees buy into the concept, which in turn leads to the continued search for even more improvements—hence the term continuous improvement. Follow-up mechanisms can include regular audits or regularly scheduled meetings to evaluate progress.
Quality control and literature about it have become a huge cottage industry in the business world. In addition to the terms outlined in this article, there are several other popular concepts and terms associated with quality control that are actually offshoots of the larger issue, or separate issues altogether. Among the most popular are:
Finally, there is one term associated with the quality control movement that is too broad and too important to cover here. Total quality management, or TQM, has become an important quality movement in its own right and is fully explained in a separate entry in this book.
Despite the growing importance of quality control in the United States, there is still room for improvement in many areas. One of the most important is the attitude towards teams, especially cross-functional ones. Teams are recognized by quality experts as one of the best ways to increase speed to market and improve quality. Slowly, as American firms adopt other quality measures, they are also adopting the team philosophy. Still, improvements must be made. Too many firms still rely on the old styles of product development and production, handing off responsibility for a product from one department to the next with no interaction between the departments.
Another problem to be overcome in the future is downsizing. One of the key business principles of the 1990s, downsizing means improving technology and work processes so that the same amount of work can be done with fewer employees. While the move to downsize has improved the bottom line at many companies, it has also raised quality concerns. Some believe that there has been a marked reduction in the quality of some products because too many firms engaged in downsizing without making sure that their internal processes and infrastructure was adequately equipped to handle the loss of employees.
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